Red coralline algae create abundant, spatially vast, reef ecosystems throughout our coastal oceans with significant ecosystem service provision, but our understanding of their basic physiology is lacking. In particular, the balance and linkages between carbon-producing and carbon-sequestering processes remain poorly constrained, with significant implications for understanding their role in carbon sequestration and storage. Using dual radioisotope tracing, we provide evidence for coupling between photosynthesis (which requires CO2) and calcification (which releases CO2) in the red coralline alga Boreolithothamnion soriferum (previously Lithothamnion soriferum)-a marine ecosystem engineer widely distributed across Atlantic mid-high latitudes. Of the sequestered HCO3-, 38 ± 22% was deposited as carbonate skeleton while 39 ± 14% was incorporated into organic matter via photosynthesis. Only 38 ± 2% of the sequestered HCO3- was transformed into CO2, and almost 40% of that was internally recycled as photosynthetic substrate, reducing the net release of carbon to 23 ± 3% of the total uptake. The calcification rate was strongly dependent on photosynthetic substrate production, supporting the presence of photosynthetically enhanced calcification. The efficient carbon-recycling physiology reported here suggests that calcifying algae may not contribute as much to marine CO2 release as is currently assumed, supporting a reassessment of their role in blue carbon accounting.